The lender has published its House Price Index, showing another month of price growth, and optimism in the property market has also improved.
House prices went up by 0.5% in November, according to Halifax’s House Price Index. Last week, we reported that Nationwide’s House Price Index showed that prices had risen by 0.2.% in November, the third consecutive monthly increase. Nationwide said the housing market was showing signs of recovery.
Halifax’s index shows a slight rise in November, marking the second month in a row that prices have gone up, according to the lender.
Why are there different house price figures?
You may wonder why Halifax and Nationwide’s House Price Index figures differ. It’s a good question. Nationwide says that while they both use similar techniques to produce average prices, the results may vary as they track slightly different properties.
‘UK house prices rose for the second month in a row, up by 0.5% in November or £1394 in cash terms, with the average house price now sitting at £283,615,’ says Kim Kinnaird, Director, Halifax, Mortgages. ‘Over the last year, despite the wider economic headwinds, property prices have held up better than expected, falling by a relatively modest 1% on an annual basis, and still some £40,000 above pre-pandemic levels.’
Housing market resilience
Halifax says that the resilience in the housing market this year has been underpinned by a shortage of properties available rather than any significant strengthening of buyer demand. However, recent figures for mortgage approvals have shown a slight increase, and mortgage interest rates have eased slightly, which may result in increased buyer confidence.
‘However, economic conditions remain uncertain, making it hard to assess the extent to which market activity will be maintained,’ says Kinnaird. ‘Other pressures – like inflation, the broader cost of living, overall employment rates and affordability – mean we expect to see downward pressure on house prices into next year.’
Countries where house prices are performing well include Northern Ireland – which has seen a 2.3% house price increase annually, and Scotland, which has maintained its prices this year – i.e. seen zero growth and zero decline – and Wales, which has seen a drop of just 1.5%. The South East of England has seen sharp falls compared to other regions of 5.7% or a price drop of around £22,702. Nationally, house prices have fallen annually by 1%.
Optimism for next year
There is more optimism among consumers about the housing market for next year. According to the latest Property Tracker report, a third of people (33%) are optimistic and expect house prices to rise in the next 12 months. This is a significant increase from just three months ago when only 20% shared the same belief. The Building Societies Association (BSA) published the report on 7 December, saying that this data represents the most positive outlook since September 2022.